Lompoc (Calif.) Valley Medical Center has agreed to pay $5 million to settle allegations that it submitted false claims to Medi-Cal related to Medicaid Adult Expansion under the ACA.
Medi-Cal was expanded in 2014 to cover the previously uninsured "adult expansion" population — those ages 19 to 64 without dependent children with annual incomes up to 133 percent of the federal poverty level, according to an Aug. 30 Justice Department news release. The federal government funded the expansion coverage for the first three years of the program.
The settlement resolves allegations that Lompoc Valley Medical Center knowingly submitted false claims to Medi-Cal pursuant to agreement executed by the health system with CenCal, according to the release. CenCal Health is a county organized health system that contracts to arrange for the provision of services under Medi-Cal.
Prosecutors alleged that the payments were not "allowed medical expenses'' permissible under the contract between California's Department of Health Care Services and CenCal; were predetermined amounts that did not reflect the fair market value of services provided; and the enhanced services were duplicative of services already required to be rendered. They also alleged that the payments were unlawful gifts of public funds in violation of the California Constitution.
The settlement includes the resolution of claims brought under the whistleblower provisions of the False Claims Act by Julio Bordas, MD, CenCal's former medical director.
The settlement brings the Justice Department's total recovery in the matter to $95.5 million, according to the release. CenCal, Cottage Health System, Sansum Clinic and Community Health Centers of the Central Coast previously paid $68 million, and San Francisco-based Dignity Health and two Tenet Healthcare-affiliated facilities in California previously paid $22.5 million to settle similar False Claims Act allegations.